Greece is just a bad poker player

"The hardest tumble a man can take is to fall over his own bluff." ― Ambrose Bierce

According to former Greek finance minister Yanis Varoufakis, there really were no negotiations between Greece and its creditors. Rather, Varoufakis describes it as a very draconian set of demands that included German control of Greece's finances. How Greece got to this point is widely known and well documented by both Michael Lewis in "Boomerang: Travels in the New Third World" and more recently in James Angelos' "The Full Catastrophe: Travels Among the New Greek Ruins." I found both books insightful, funny and quite sad, but from what we've seen play out over the past several months of harsh negotiations, it seems the Greeks and their then finance minister truly believed they could once again fool global bankers into lending them money with little more than a promise to repay same. In other words, the Greeks were playing the lenders for fools.

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Former Greek finance minister Yanis Varoufakis.

I don't mean to trivialize the human tragedy that is Greece today, with pensioners seeing steep reductions in their monthly payments and capital constraints limiting the ability of Greeks to access their money, or the impact to businesses unable to restock their shelves. Truly this is a disaster unfolding on our television screens daily, but sadly, this is a self-inflicted wound, administered by an inept prime minster and a foolish finance minister.

The reason I say minister Varoufakis was foolish is that he made two classic mistakes in how he played his hand versus the International Monetary Fund and the Europeans. First, he got high on his own supply. True, minister Varoufakis isn't a drug dealer, but that phrase (high on your own supply) addresses drug dealers and why they shouldn't take the very drugs they are dealing. If they do, they'll become addicted and stop making lots of money. Dealers aren't supposed to get high on their own supply of weed, coke, heroin, crack etc. or they'll lose focus of their goal: making money at the expense of others.

In his book "Game Theory: A critical text," chapter four, minister Varoufakis writes eloquently and accurately about bargaining power and Ariel Rubinstein's solution to the bargaining problem. Briefly, a Rubinstein bargaining model refers to a class of bargaining games that feature alternating offers through an infinite time horizon. This, like many academic pursuits may work in theory, but the infinite time-frame needed for this to work in the Greek's favor simply didn't exist. The Germans and other Northern Europeans were determined to see to that and without unlimited time, the Greek finance minister had backed his country into a corner.

The second mistake was to push the idea that he is an expert on game theory and thus bluffing and negotiation. I've played a fair amount of high-stakes poker. I'm proud to say I know a few of the best players in the world personally. They tend to have patience, very quantitative minds, big egos and are disciplined to a fault. One thing I've never seen from top poker players is any of them bragging about how good they are at bluffing. It would not create any edge for them in the game and instead would likely, as it did in Varoufakis' case, show a weakness that the other players would exploit.

Greek Prime Minster Alexis Tsipras and Varoufakis may have strengthened the Syriza party's political power in Greece, but their failed bluff has resulted in far more oppressive and severe obligations for the Greek people.

And while neither Tsipras nor Varoufakis dug the Greek people into the hole that they are in, they'd be wise to remember Jack London's famous quote about poker, "Life is not always a matter of holding good cards, but sometimes, playing a poor hand well."

Commentary by "Fast Money" trader Jon Najarian, a professional investor, money manager, media analyst and co-founder of optionMONSTER and tradeMONSTER. He worked as a floor trader for 25 years and before that, he was a linebacker for the Chicago Bears. Follow him on Twitter @optionmonster.